Thank you very much, Chair.
Good afternoon, everyone.
I'm pleased to be back before the committee. Of course, I have my wingers here, which will be very helpful for information.
I want to thank the committee for its outstanding support for the Canadian agriculture and agri-food sector. The members of the committee are working together and across party lines to address some pressing priorities for Canadian farmers, and I want to thank the committee for its work on climate change issues in agriculture, advancements of technology and research in the agricultural industry to support Canadian exports, and the grain transportation backlog.
In particular, I want to thank the committee for its upcoming study on the mental health challenges faced by our farmers. This is a very serious issue, both on and off the farm. Mental health is a high priority for our government. My deputy minister has made it a high priority for the department, and our colleague, Mr. Jean-Claude Poissant, has been a champion for mental health on the farm, both in his riding and across the country.
My message to you today is that our government will continue to work with you to grow the Canadian agriculture and agri-food sector. I would like to touch on three areas: the main estimates, progress and priorities, and challenges and opportunities for the sector.
As you can see, the main estimates show a total budget of over $2.5 billion for 2018-19. That represents an increase of $260 million compared with last year. The two main reasons for this increase are the forecast increase of $150 million in business risk management spending based on market conditions, and $96 million for new programs to help dairy producers and processors stay on the cutting edge.
Across Canada we're rolling out our investments under the $350-million program for dairy processors and producers. These dollars are helping the industry boost production and efficiency through investments in equipment and systems for milking robots and processing technologies.
The main estimates also reflect great work done with the Canadian agricultural partnership. That includes grants and contributions of $105 million for the coming year for federal programs supporting research and innovation, market development, public trust, business risk, and diversity. The estimates also include over $200 million in cost-shared programs with the provinces and territories. It all adds up to a major investment in the agriculture and agri-food industry.
We've reached a couple of milestones since we last met. On May 23, Bill C-49 received royal assent. This is tremendous news for the grain industry. We proposed key amendments that responded to the needs of the industry. Demand for our great Canadian wheat and interest in grains continue to grow. The legislation will help to ensure our farmers can meet these demands with an efficient and reliable rail service. We want a world-class transportation system, not just for this year or next year but for many years down the road.
April 1 marked the launch of the new $3-billion, five-year Canadian agricultural partnership. The industry was very clear on the need for a smooth transition from the previous framework, and we were able to do that. We have completed almost all the bilateral agreements with the provinces and territories, covering shared funding of $2 billion over five years. The Canadian agricultural partnership also includes $1 billion over five years for federal activities and programs.
In February, as I mentioned earlier, we launched six federal programs to help the sector reach new heights. We also continue to support the great work of our agricultural scientists across the country. Agricultural and agri-food scientists continue to make groundbreaking discoveries that help our farmers increase production, cut costs, and boost the bottom line.
Over the next five years, the Canadian agricultural partnership will help Canadian farmers and processors grow their markets, innovate, and protect our environment. It will also help farmers manage their business risk while strengthening public trust in their products. The partnership will help bring more young farmers, women, and indigenous people into leadership roles in the sector.
Investments over the past three budgets are building on a strong agricultural agenda.
Agri-food has been selected as one of the five groups to receive funding under the $950-million supercluster initiative, budgeted in 2017. Protein Industries Canada will make our country a global leader in sustainable plant protein. It will help to open new markets for our pulse growers.
Budget 2018 builds on this work with the single largest investment in fundamental research in Canadian history. That's an investment of nearly $4 billion in Canada's research system to support the next generation of researchers, while upgrading the tools they need to do the job.
We're also investing $75 million to grow our trade in China and across key Asian markets for Canadian farmers. Trade continues to be a strong focus for our government.
We're aiming to increase our agricultural exports to $75 billion by 2025. On March 8, Canada signed the CPTPP. For the agricultural sector, that means tariffs will be eliminated on Canadian meat, grains, and horticultural and processed foods. The access could mean $1 billion per year of new sales for beef and pork producers.
When you combine these benefits with the benefits under our trade agreement with the EU and other trade agreements, Canadian farmers will have a competitive edge in about two-thirds of the global economy. That's good news because it helps us diversify our trade.
Asia is a new frontier for our farmers and food processors. In March, I led a trade mission to Japan and Korea, and earlier this month I was in China, which has a growing middle-class population that's looking for the food that our farmers and ranchers can produce. The mission was a great opportunity to showcase Canada's high-quality food and seafood, and to strengthen our ties.
We're also working with our partners in North America to update, modernize, and improve NAFTA. Right across North America, farmers are united in their support of NAFTA. On Thursday, I will be in Dallas to address the World Meat Congress, and I will deliver Canada's message for a strong, modern, and progressive NAFTA.
The bottom line is that Canada's farmers are ready to feed the world, and the Government of Canada stands ready to support them in these efforts. Of course, challenges remain and always will. We're working to resolve the situation in India affecting our pulse exports.
There will always be challenges in agriculture, whether it's tough competition on the global stage, protectionism, or changing consumer demands.
When I look ahead at the prospects for our great industry, I see a great promise. Canada's agriculture and agri-food industry continues to grow. Last year, the industry generated $111 billion of our GDP, according to our recent financial outlook. The average farm net worth will hit a new record in 2018, and Canada's net farm income will be the second highest on record. Last year, our agriculture food and seafood exports hit an all-time record of over $64 billion, moving us closer to that $75 billion target.
Demand for our food continues to grow, and Canada has a competitive edge to meet that demand. We are blessed with an abundance of farmland and water, the best farmers and ranchers in the world, and a government that's reinvesting in agriculture.
The time is right for the Canadian agriculture and food industry to increase its presence on the global stage. Through smart investment and continued collaboration, I'm confident that we can meet the challenges that lie ahead.
I want to thank you again for your attention.
Thank you, everyone.
